JD Technology Withdraws Its IPO Application to the Shanghai Stock Exchange

JD Technology, previously known as JD Digits and JD Finance (Source: JD Technology)

On March 30, Fintech company JD Technology, a subsidiary of e-commerce giant JD.com, withdrew its IPO application to the Shanghai Stock Exchange. In response, the exchange’s listing committee last Friday announced it has decided to terminate the firm’s IPO review.

According to a prospectus unveiled on September 11, 2020, JD Technology, previously known as JD Digits and JD Finance, provided digital solutions for various subjects including financial institutions, merchants and enterprises, government and other customers. The shares it planned to issue would have been no more than 538 million, accounting for no less than 10% of the total capital.

From 2017 to 2019, the annual operating revenue of JD Technology was 9.070 billion yuan($1.384 billion), 13.616 billion yuan ($2.076 billion) and 18.203 billion yuan ($2.778 billion) respectively. The revenue of the first half of 2020 was 10.327 billion yuan ($1.576 billion).

However, under tighter financial regulation, the firm’s IPO withdrawal was expected – especially after on November 3 last year, SSE and HKEX both announced to halt the IPO process of Ant Group.

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Affected by new regulations on online small loans, JD Technology is adjusting its business scope. Since the IPO application last September, the company’s name, business model and senior management team were all changed.

On March 31, JD.com signed a definitive agreement to transfer its cloud computing and artificial intelligence operations worth 15.7 billion yuan ($2.4 billion) to JD Technology, which means that the technological features of the firm would be highlighted.

In December 2020, JD.com announced that Chen Shengqiang, the former CEO of JD Digits and JD Finance, would become the new vice chairman of the firm, and Li Yayun, the former chief compliance officer of JD.com, would be appointed as the new CEO. In January, the company adopted a new name — “JD Technology”.

Recently, the senior management team of JD Technology has changed again. Xu Ling, the former head of the financial technology group of JD Technology, moved to become the head of the strategic planning department of JD.com, while Li Bo took over Xu’s previous position.

After absorbing in new businesses and experiencing personal adjustment, JD Technology may re-submit a listing application. If the application is successfully accepted, it will become another listed company belonging to JD.com, following by JD Health and JD Logistics.

At the same time, JD.com continues to incubate new branches, such as JD Industrial Products and JD Production and Development. The latter has raised considerable financing lately.